If you provide a designated service where A$10,000 or more of cash is transferred, a threshold transaction report (TTR) must be submitted to AUSTRAC. A designated service is a service that has been identified in section 6 of the AML/CTF Act as posing a risk for money laundering and terrorism financing. Designated services include a range of business activities in the financial services, bullion, gambling and digital currency exchange sectors.
“Structuring” is a common money laundering method whereby a larger cash transaction is split into several smaller transactions to avoid a TTR being submitted. If you reasonably suspect that transactions have been structured to try and prevent them from being reported in a TTR, or that the transactions could be linked to criminal activity, you must submit a suspicious matter report (SMR) to AUSTRAC.
This article explores various scenarios involving multiple cash transactions, and the reporting obligations based on the circumstances, as outlined by AUSTRAC.
Examples where a TTR is required
Example 1
Wei splits a $27,000 cash deposit into two accounts he holds at Bank A, with $15,000 in one account and $12,000 in another. Both transactions exceed the $10,000 threshold, so Bank A must submit two TTRs to AUSTRAC – one for the $15,000 transaction and another for the $12,000 transaction.
Example 2
Alexandra deposits $30,000 cash into her account at an intelligent ATM operated by Bank B. Due to an error, only $17,000 is credited to her account initially, and Bank E submits a TTR for $17,000 to AUSTRAC. After resolving a dispute lodged by Andrea three days later, Bank B credits the missing $13,000 to her account. Bank B must amend the initial TTR to include the missing $13,000.
Example 3
Vijay visits a branch of Bank C to purchase a bank cheque for $10,000 and pays an additional $10 fee for the cheque. Bank C must submit a TTR for the purchase of the $10,000 bank cheque, but the fee for the cheque is not included as part of the designated service.
Example 4
Margaret attends a remittance service provider with $12,000 cash to send money to her family and contribute to the development of a community centre in a foreign country. Margaret sends $2,000 to her family in one transaction. In a separate transaction she sends the remaining $10,000 which was collected from her extended family and friends for the development of the community centre. The first transaction doesn’t meet the threshold, but the second one does. Thus, the remittance service provider must submit a TTR for the second transaction.
Example 5
Robert places a $12,000 cash bet on a horse race. Since the amount exceeds the $10,000 threshold, the wagering outlet must submit a TTR to AUSTRAC.
Examples where a TTR is not required
Example 1
Pam splits a $12,000 cash deposit into her account at Bank D to align with her business turnover for different days. She makes three deposits, each a few minutes apart: $4,500 for Friday’s turnover, $4,500 for Saturday’s turnover, and $3,000 for Sunday’s turnover. Since each deposit is considered a separate designated service and none involve a threshold transaction, Bank D doesn’t need to submit a TTR. If Pam’s explanation for the split transactions is reasonable, an SMR may not be required.
Example 2
Allan exchanges $7,000 in cash for gaming chips at a casino, and later purchases an additional $5,000 in gaming chips at a blackjack table using cash. Both transactions are separate designated services and do not meet the threshold for reporting. However, if Allan’s behaviour raises suspicion, an SMR may need to be submitted.
Key takeaways
You must submit a TTR to AUSTRAC for each individual cash transaction of A$10,000 or more. If your customer makes multiple cash transactions under A$10,000, each individual transaction is considered a separate designated service. You don’t need to aggregate the transactions and submit a TTR, even if the transactions occurred in quick succession. However, if you suspect your customer is structuring their transactions to avoid the TTR reporting threshold, or is transacting with proceeds of crime, you must submit an SMR to AUSTRAC.
